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Memorandum: Class Deviation—Providing Accelerated Payment to Small Business Subcontractors

TO:Heads of Contracting Activity

Angela Billups, PhD
Associate Deputy Assistant Secretary for Acquisition

SUBJECT:Class Deviation—Providing Accelerated Payment to Small Business Subcontractors

Effective immediately, contracting officers shall use the attached clause to require prime contractors to pay small business subcontractors on an accelerated timetable to the maximum extent practicable.  Accordingly, contracting officers shall insert the clause at 52.232-99 (DEVIATION)(AUG 2012) in all new solicitations issued and resultant contracts awarded after the date this deviation is signed and, to the extent feasible, modify existing solicitations to insert the clause at 52.232-99 (DEVIATION)(AUG 2012).  Contracting officers may amend existing contracts to insert this clause in accordance with FAR 1.108(d).

This deviation implements the temporary one-year policy provided by OMB Policy Memorandum M-12-16, Providing Prompt Payment to Small Business Subcontractors, dated July 11, 2012, which is designed to accelerate payment from federal prime contractors to their small business subcontractors.  To assist in expediting contractor payments to small business subcontractors, HHS will provide accelerated payments to all prime contractors after receipt of a proper invoice and all proper documentation while also maintaining necessary HHS internal controls (see attached August 15, 2012 letter signed by HHS Deputy Assistant Secretary, Finance).

This deviation remains in effect until it is incorporated into the FAR or HHSAR or is otherwise rescinded.  My point of contact is Cheryl Howe, who may be reached on 202-690-5552 or at .


*NOTE: Persons using assistive technology may not be able to fully access information in the file above. For assistance, contact the GSA Office of Governmentwide Policy.